Security service

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

17 September 2013 I am a Accountant please solve our Problem

our company is Proprietorship
we are security service provider.so will we pay service Tax ???

CA Hemlata Saini

CA Hemlata Saini (Expert)
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17 September 2013 YES @ 3.09%, IF TOTAL TURNOVER WAS MORE THAN 10LAC IN PREVIOUS YEAR OR DURING THE YEAR.

Querist : Anonymous

Querist : Anonymous (Querist)

17 September 2013 EXCISE AUDIT ARE GOING ON SO SECURITY CONTRACTOR DONT CHARGES SERVICE TAX IN YOUR INVOICE, WE HAVE PAID TOTAL PAYMENT SO LAST THREE YEAR 2 LACS TOTAL BILLING ,
WE WILL PAY SERVICE TAX !!!!

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RENGARAJ R.K

RENGARAJ R.K (Expert)
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18 September 2013 To whom you are providing your security service? E.g Firm, Company??

Querist : Anonymous

Querist : Anonymous (Querist)

18 September 2013 PROPRIETORSHIP FIRM

CA Suresh Jain

CA Suresh Jain (Expert)
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22 September 2013 If you a service provider you need to pay service tax if :-

1. amount of taxable service in previous year was more than 10 lakh in previous year, or
2. amount of taxable service in previous year was less than 10 lakh in previous year but more than 10 lakh in the current financial year,
if answer to the above is positive then you are required to pay service tax @ 12.36% but, since, you are a proprietor ship firm, where you provide such service to body corporate you need to pay service tax @3.09%

disclaimer- all answers are given as per the facts narrated by you. Answer may differ after study of full facts/statements/agreements etc. involved in the case

RENGARAJ R.K

RENGARAJ R.K (Expert)
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22 September 2013 Yes Suresh ji,

But instead of 3.09%, we can explain that the service provider (prop) need to collect and pay 25% and the balance 75% will be paid by Service recipient (viz., company) under reverse charge mechanism.

CA Pallav Singhania

CA Pallav Singhania (Expert)
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22 September 2013 Agree with Experts,

Under reverse charge the liability of service receiver and the service provider is independent,
The service provider for security services should charge only 25% of 12.36% st in the invoice, even if he collects the full st and pays it to the gov. the service receivers' liability will not be absolved... the service receiver should remit 75% of the st to the gov from his side. So if they charge full st...deduct 75% and pay only the balance amount.

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